Never mind $30K in the bank and a puny $745,000 (49%) increase in revenue. What's important is the fact that there is not only ZERO PROFIT, but there is tons of DEBT and more TOXIC FINANCING (YA) looming on the horizon.
"For the years ended December 31, 2011 and 2010, we incurred operating losses of $5.3 million and $6.2 million, respectively. Net cash used by operations during the years ended December 31, 2011 and 2010 was $4.5 million and $5.7 million, respectively. At December 31, 2011, we have an accumulated deficit of $245.2 million. We also have a working capital deficit of $75.9 million, of which $56.9 million is related to our financing instruments, including $31.4 million related to the fair value of warrants and those debentures that are recorded as hybrid financial instruments, and $25.5 million related to the amortized cost carrying value of certain of our debentures and the fair value of the associated derivative liabilities. Our working capital deficit includes a continuing purchase price guarantee obligation of $4.5 million associated with an acquisition of a business in 2006, which we subsequently sold in 2007.
The items discussed above raise substantial doubts about our ability to continue as a going concern.
We currently do not have sufficient cash, or commitments for financing to sustain our operations for the next twelve months.
We will require additional financing in order to execute our operating plan and continue as a going concern. Our management’s plan is to secure adequate funding to bridge the commercialization of our patent licensing and barcode ecosystem businesses. We cannot predict whether this additional financing will be in the form of equity, debt, or another form and we may not be able to obtain the necessary additional capital on a timely basis, on acceptable terms, or at all. In the event that these financing sources do not materialize, or that we are unsuccessful in increasing our revenues and profits, we may be unable to implement our current plans for expansion, repay our debt obligations as they become due or respond to competitive pressures, any of which circumstances would have a material adverse effect on our business, prospects, financial condition and results of operations.
Should YA Global choose not to provide us with continued capital financing, as they have in the past, or if we do not find alternative sources of financing to fund our operations or if we are unable to generate significant product revenues, we may not have sufficient funds to sustain our current operations through the next 12 months. Our debenture obligations to YA Global currently mature on July 29, 2012.
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